$250 may not seem like a big sum for MBA applicants. That’s the cost of two years of Netflix – or the application fee for a target school. Between rent and debt, it isn’t always easy for young professionals to scrape together that amount. And it is even more daunting when the school only accepts one candidate from every ten applications.
Those are the odds of getting into Harvard Business School. Today (June 17), HBS announced that it would begin offering a needs-based application fee waiver for the 2021-2022 cycle. According to the school, the action is designed to attract a more diverse set of candidates, while reducing financial hurdles that might spook students who face hardship.
APPLICANTS GET TO MAKE THEIR CASE
The goal of the waiver is to prevent potentially talented leaders, both in the classroom and the world beyond, from passing on applying at HBS due to an upfront cost. The waiver, which is part of the application, can accommodate a variety of life issues, such as low income or assets, debt, or family obligations. To qualify for a waiver, applicants must submit income information, with applicants notified by email whether they’ve qualified.
The waiver is also set up as open form, so applicants can explain their circumstances in detail, says Chad Losee, managing director of MBA admissions and financial aid at Harvard Business School. “They can share in own words why they feel the application fee might present a financial hardship to them,” Losee told P&Q in a June 16 interview. “Then we’re going to learn a lot in the next year about the different needs and burdens that people face and how we can support them as well as we can.”
The needs-based waiver is a work-in-progress, Losee admits. Over the past year, it has been piloted in HBS’ 2+2 deferred admissions program. That program, however, catered to undergraduates instead of workforce professionals. As a result, Losee is unsure how many application fee waiver requests will be made (or accepted) this coming cycle.
DIVERSITY IS A NECESSITY
Before the pilot, Losee notes, his admissions team has been researching ways to break down the barriers that prospective applicants face in pursuing graduate business school. Not surprisingly, he found that financial issues were regularly high on their lists. Losing these voices represented a threat to HBS. The reason: the program’s cornerstone is the case method, which is fueled by a collision of different professional and socioeconomic backgrounds.
“We’re always thinking about how to make our mission to educate leaders to make a difference in the world,” Losee tells P&Q. “We think about that very broadly and our learning model really requires having a lot of different perspectives in the classroom.”
The waiver also fits within the vision of the business school – and the larger university – around diversity, equity, and inclusion. For HBS, the goal isn’t just to attract students from different backgrounds, Losee emphasizes, but also support them after they arrive. He points to the school’s student-led Socioeconomic Inclusion Task Force, whose work spurred new programming. For example, the school launched a First Gen/Low Income Club. At the same time, Losee adds, the school has designated leaders in financial aid, student support, and career services to work specifically with students from different socioeconomic backgrounds to provide a stronger support system. Even more, the task force’s work reinforced the importance of building a student body that more closely reflects society-at-large.
“We are thinking about people who are going to start and build businesses,” Losee explains. ”That should not just serve one segment of society, but we can help be an engine of social mobility across society – not just in this country but around the world.”
A HOLISTIC APPROACH
On the surface, the $250 needs-based fee waiver may seem like a drop in the bucket. Even if 10% of the Class of 2024 earns a waiver, HBS will only lose out on maybe $250,000. That’s almost a rounding error for an institution that took in $861 million dollars in the 2020 fiscal year. Still, the waiver pales in comparison with another HBS initiative. For the past three years, the school has kept its tuition at $73,440. This move was made to make HBS more accessible to prospective MBAs. In the process, it has cost the school up to an estimated $4 million dollars.
That’s just the start. Roughly half of HBS MBAs receive a fellowship, which averages $42,034 per year according to its newly-released 2020 annual report. Overall, HBS doled out $57 million dollars to graduate business students in 2020, with the majority earmarked for MBA students. This also represented a $6 million dollar increase in support during COVID, despite the school’s alumni donations being shaved in half. To put it another way, HBS returned roughly 26 percent of tuition in the form of fellowships last year. Such support also accounts for 7 percent of the school’s budget (up a point from the previous year).
In practice, HBS takes a “need-blind” approach in making admissions decisions. Still, the school takes great financial pains to level the playing field for everyone.
“We are trying to take a holistic approach to support students from all different backgrounds,” Losee explains. “Our focus has been that financial barriers should not preclude anyone from aspiring to apply or attend Harvard Business School. This App fee waiver is one part of many things we are doing to attract students from all socioeconomic backgrounds. This is purposely next to our needs-based approach to financial aid and the updates we’ve made to our financial aid formula to not just include personal assets but to also take into account socioeconomic backgrounds and the burdens that people are carrying with them. It fits very closely with the tuition we’ve held flat…and the efforts we discussed earlier. [The needs-based application fee waiver] is part of a whole we are working on rather than just a one-off update. All of these policies are designed to support and reinforce each other in supporting students.”
A LOOK AT THE INCOMING CLASS
Aside from the waiver, these financial benefits will also be enjoyed by the Class of 2023. Losee believes this will be the largest class in the school’s history, numbering over 1,000 students. The only difference, he notes, is that the school added an 11th section to accommodate the increased number of students – a bump that partially stems from last year’s COVID-19 deferrals.
“We didn’t want to disadvantage people who were applying this year,” Losee tells P&Q. “Working closely with faculty and university, we made the decision to increase class size this year and next year as we accommodate the deferred and the new applicants.”
What can we expect from the incoming class? Losee remained tight-lipped on specifics, but dropped some hints that this year’s class may be a bit different than those from year’s past.
“It is an exceptionally talented and diverse group of people who have worked in every industry and many corners of the world,” he adds. “Many have worked in government or company roles on the front lines of COVID-19, supporting people who’ve been affected by the pandemic or helping craft policies to support [institutions and] organizations that have evolved as they navigated this global pandemic. That is something that is reflected in the experiences of the students who are coming in and we’re looking forward to having their perspective.”
DON’T MISS: MEET HARVARD BUSINESS SCHOOL’S MBA CLASS OF 2022